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Vietnam’s legal update in April

Directive of the Prime Minister on the enhancement of the implementation of policy and regulations on minerals (№ 03/CT-TTg, dated 30 March 2015) (“Directive 03”)

Directive 03 is a policy document which requires other authorities, such as the Ministry of Natural Resources and Environment (“MONRE”) and the Ministry of Industry and Trade, to issue implementing regulations to affect the policies as outlined in the Directive.

Key policies set out in Directive 03 for future implementation are:

Prohibition on the export of unprocessed minerals;

Exportation of minerals will be restricted to processed minerals which are of high value, in accordance with the approved Strategy on Minerals by 2020 (current restrictions relating to exportation of processed minerals are primarily set out in Circular № 41/2012/TT-BTC dated 21 December 2012);

Prohibition on the issuance of any new licenses for the exploration and exploitation of gold placer; and

Restriction on small-scale exploitation of minerals, leading to eventual prohibition.

In the recent Decision 411 (№ 411-QD-BTNMT, dated 14 February 2015) MONRE signaled its intent to hold four auctions for mining tenements this year. This is a welcome decision to implement the provisions of the Minerals Law and will be the first auctions to be held under the provisions.

MONRE, through the Mineral Mining Auction Council, intends to hold auctions in 2015 relating to four tenements, one each for iron, fluorite, industrial stone and gold.

A basic outline of the auction process is set out in Decree 22 (№ 22-2012-ND-CP, dated 26 March 2012) and requires the preparation of the invitation documents by MONRE, establishment of an initial bid price, the payment of a deposit by potential bidders to participate in the auction process, payment of any mandated auction participation fees, and the submission of the application (in the prescribed form) by the potential bidders. The auction will thereafter be held in accordance with regulations, which currently require a secret ballot to be held; although the Auction Council may release further rules to clarify this process further.

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